Shortly before Christmas, FTX founder Samuel Bankman-Fried, indicted on federal charges of fraud and money laundering, was released on a $250 million bail bond that was secured by his parents’ Palo Alto-area home.
The size of the bail bond — 25 times bigger than Bernie Madoff’s — garnered considerable attention. The prosecution termed it “the largest ever pretrial bond.” What hasn’t drawn notice is the fact that Joseph Bankman and Barbara Fried, who are professors at Stanford Law School, are not typical homeowners. Their property is a faculty home on the Stanford campus itself. Stanford owns the land, and Bankman and Fried lease it.
Although the couple told the court that the five-bedroom, 3,000-square-foot home is worth $3.55 million, the restrictions that come with owning a home on Stanford property make it difficult to gauge its market value via conventional means. Were Bankman and Fried ever to sell their house — or were the government to take possession of it, in the event of a bail violation, and then have to sell it — the pool of potential buyers would be limited to other eligible Stanford faculty. Whatever the scenario, a sale would have to go through Stanford.
